In Search of Useful Theory of Innovation By Richard R. Nelson and Sydney G. Winter

1. In Search of Useful Theory of Innovation By Richard R. Nelson and Sydney G. Winter 발표자: 이기영, 한혜나

2. Introduction 기존 이론이 가진 문제점 혁신에 관한 knowledge와 research가 산발적으로 흩어짐 연구의 중심이 production 이 얼마나 fit 한가와 어떻게 shift 하는가에 있음 기존 이론이 간과한 혁신의 속성 근본적으로 가진 불확실성(Uncertainty) 산업부문별로 혁신을 지원하는 institutional structure가 매우 다양함

4. 2. The State of Current Understanding • 2.1 The economist’s model of differential productivity growth(1)

5. 2. The State of Current Understanding • 2.1 The economist’s model of differential productivity growth(2) • Institutional • variables R&D Expenditure Productivity • Innate differences across industries

6. 2. The State of Current Understanding • 2.2 Building blocks for a broader theoretical structure Productivity growth를 theoretical structure로 삼는 것이 좋지 않은 이유

7. 2. The State of Current Understanding • 2.2 Building blocks for a broader theoretical structure • If there is to be any hope of integrating the disparate pieces of knowledge about the innovation process, a theory of innovation must incorporate explicitly the stochastic evolutionary nature of innovation, and must have considerable room for organizational complexity and diversity. • Premises

8. 3. The generation of Innovation • 3.1 The profit maximization hypothesis and its limitations

9. 3. The generation of Innovation • 3.2. R&D strategies and probabilistic outcomes • An R &D project, and the procedures used by an R & D organization to identify and screen R & D projects, can be viewed as interacting heuristic search processes. • A quasi stable commitment to a particular set of heuristics regarding R & D project selection can be regarded as an R & D strategy. Often it is possible to identify a few R & D strategies that are prevalent in a particular sector in a particular era. • An R & D strategy might be modeled extensively in terms of the heuristics employed in the search processes and their consequences. Algorithm for calculating an optimum Good Heuristics

10. 3. The generation of Innovation • 3.3 ~Natural trajectories o In many cases natural trajectories are specific to a particular technology or broadly defined ‘technological regime’ - ex) In airframe design, theoretical understanding (at a relatively mundane level) always has indicated that there are advantages of getting a plane to fly higher where air resistance is lower. This leads designers to think of pressurizing the cabin, demanding aircraft engines that will operate effectively at higher altitudes, etc.

11. 4. The Selection Environment • 4.1 Elements of the selection model o the selection environment determines how relative use of different technologies changes over time. o In almost all economic sectors the firms - for-profit private organizations, public agencies, individual professionals - are subject to monitoring mechanisms which influence the innovations that score well or poorly according to the objectives of the firms o a second innovation spreading mechanism that needs to be considered - imitation o General model of the selection environment can be built from specification of these three elements: the de~nition of ‘worth’ or • profit that is operative for the firms in the sector, the, manner in which consumer and regulatory preferences and rules influence what is profitable, and the investment and imitation processes that are involved.

12. 4. The Selection Environment • 4.2 The market as a selection environment o Successful innovation leads to both higher profit for the innovator and to profitable investment opportunities. o Both the visible profits of the innovators and the losses experienced by the laggers stimulate the latter to try to imitate. • 4.3 Nonmarket selection environment o A hallmark of nonmarket sectors is that the separation of interests between firms and customers is not as sharply defined as in market sectors.

13. 5. THOUGHTS ON THE EFFECTS OF INSTITUTIONAL STRUCTURE • innovation be treated as inherently stochastic, and that the formulation be capable of encompassing considerable institutional complexity and variety. • the uncertainty and institutional diversity surrounding innovation can help make thinking about policy issues more sophisticated than has been the norm. o there is far more to institutional variation than differences in the average size or market power of firms. In some of the sectors the critical institutions are not firms at all in the ordinary sense (e.g., medical care, garbage collection, etc.).